AUD Remains Strong04 July 2012 02:00 - Currency Exchange Australia
AUD Remains Strong
The Australian economy has been holding its ground and seems to be one of the only economies across the globe to be doing so. New retail figures show that the AUD is continuing to push higher across the board. Retail sales that came in for May were much higher than forecasters predicted, they rose 0.5 percent m/m versus 0.2 percent expected with a 0.3 percent upward revision to +0.1 percent the previous month, this increased the strength of the economy further. The Australian financial sector has been savvy in dealing with the economy and keeping the country out of the global crisis, for example at the beginning of the month the RBA cute rates by 50bp which most likely helped sentiment. There is another 25bp cut in June to further help consumer sentiment andspending which suggests that next month’s figures will be just as positive.
As well as this rise the Australian services PMI hit a five month high of 48.8 in June. This was great for the AUD but the PMI still remains below the 50 contraction/expansion threshold for a fifth month. Though the sales index rose above 50 to 50.6, employment gained 5.1 points to 49.1 and new orders surged from 9.9 points to 50.3. A continuation to this rising trend will certainly give the RBA hope that they will maintain their current position.